Einstein Noah Restaurant Group Reports Fourth Quarter and Fiscal 2012 Financial Results

  Einstein Noah Restaurant Group Reports Fourth Quarter and Fiscal 2012
  Financial Results

  Seventh Consecutive Quarter of Positive System-Wide Comparable Restaurant
                                    Sales

 Record Revenues, Record Adjusted EBITDA, & Record Cash Flow from Operations
                               for Fiscal 2012

Business Wire

LAKEWOOD, Colo. -- February 28, 2013

Einstein Noah Restaurant Group, Inc. (NASDAQ: BAGL), a leader in the
quick-casual segment of the restaurant industry operating under the Einstein
Bros.® Bagels, Noah's New York Bagels®, and Manhattan Bagel® brands, today
reported financial results for the 13-week fourth quarter and 52-week fiscal
year ended January 1, 2013. The fourth quarter and fiscal year in 2011 were 14
weeks and 53 weeks, respectively.

Highlights for the 13-Week Fourth Quarter 2012 Compared to the 14-Week Fourth
Quarter 2011; and for the 52-Week Fiscal 2012 Compared to the 53-Week Fiscal
2011:

  *System-wide comparable store sales for the fourth quarter increased 1.4%,
    the seventh consecutive quarter of positive trends. For the year,
    system-wide comparable store sales increased 1.0%.
  *Total revenues decreased $4.5 million, or 3.9%, to $110.6 million from
    $115.1 million reflecting the impact of the additional revenues from the
    14^th week in the fourth quarter of 2011. Total revenues for the year
    increased $3.4 million, or 0.8%, to a record $427.0 million from $423.6
    million.
  *Excluding the extra week in fiscal 2011, total revenues increased 2.6% in
    2012 for the fourth quarter and for the year, with revenue growth offset
    by the closure of the Company’s commissaries.
  *For the year, adjusted EBITDA increased $5.2 million, or 11.7%, to a
    record $49.7 million from $44.5 million. (*)
  *Cash flow from operations for the year increased 24.0% to a record $48.5
    million from $39.1 million.
  *Net income for the fourth quarter was $3.2 million, or $0.18 per diluted
    share. For the year, net income was $12.7 million, or $0.74 per diluted
    share compared to net income of $13.2 million, or $0.78 per diluted share.
  *For the year, adjusted net income increased $3.3 million, or 25.2%, to
    $16.4 million, or $0.95 adjusted earnings per diluted share, compared to
    adjusted net income of $13.1 million, or $0.78 adjusted earnings per
    diluted share, on a comparable 52-week basis. (*)
  *The Company paid a total of $76.6 million in a one-time special and
    regular quarterly dividends.

Jeff O’Neill, President and Chief Executive Officer, stated, “2012 was a
strong year at Einstein Noah as we successfully executed on our key objectives
and delivered strong financial results to our shareholders. We achieved record
revenues, record adjusted EBITDA, and record operating cash flow through a
combination of positive comparable sales, unit development, and operational
improvements. We also returned a substantial amount of capital through a
one-time special dividend as well as our regular quarterly dividends, further
demonstrating our long-term confidence in the business.”

O’Neill continued, “Specific to the fourth quarter, we generated our highest
comparable sales result of the year and seventh consecutive quarter of
comparable store sales growth overall as our product and marketing initiatives
resonated with customers. From a profitability standpoint, gross profit
margins as a percentage of revenues improved reflecting the positive impact of
our initiatives. All in all, we consider the fourth quarter a fine ending to a
year in which we created and unlocked value for the benefit of all
shareholders.”

Fourth Quarter 2012 Financial Results

For the fourth quarter ended January 1, 2013, system-wide comparable store
sales increased 1.4% on a 13-week basis, reflecting 3.9% growth in average
check. The higher average check was driven by a combination of favorable
product mix and price.

Total revenues decreased 3.9% to $110.6 million from $115.1 million,
reflecting a 3.4% decrease in Company-owned restaurant revenues, a 12.9%
decrease in manufacturing and commissary revenues (related to the planned
commissary closures earlier in the year, offset by higher revenues from the
manufacturing facility to third parties), and a 4.7% increase in franchise and
license related revenues. Excluding the extra week in fiscal 2011, total
revenues increased 2.6% in 2012 for the fourth quarter. The year-ago fiscal
period benefitted from an incremental 14^th week, which contributed $7.3
million in total revenues to the fourth quarter of 2011.

Restaurant gross margin was a strong 20.5%, down 100 basis points as a
percentage of restaurant sales from 21.5% in fiscal 2011 reflecting the
deleveraging of many fixed costs as a result of not having the benefit of the
incremental operating week in the fourth quarter of 2012. The benefit of
having an extra week in the fourth quarter of 2011 improved restaurant gross
margin by approximately 100 basis points. Prime costs, defined as cost of
sales plus labor costs, were 120 basis points lower than the prior-year
period.

Manufacturing and commissary gross margin as a percentage of manufacturing and
commissary revenues increased from 11.3% to 23.2% and was driven by benefits
from various cost initiatives, and the commissary closures earlier in the
year.

Overall, gross profit was $25.5 million in the fourth quarter of 2012 compared
to $26.3 million in the fourth quarter of 2011, but as a percentage of total
revenues, increased 20 basis points to 23.1% from 22.9% in the year-ago
period.

General and administrative expenses decreased to $9.4 million in the fourth
quarter of 2012 from $9.5 million in the fourth quarter of 2011 and reflect a
decrease in expense due to one less week of operations offset by higher
variable compensation expense.

Pre-opening expenses increased to $711,000 compared to $110,000 as a result of
opening 11 company-owned restaurants in the fourth quarter of 2012 compared to
opening 2 company-owned restaurants in the fourth quarter of 2011.

The Company incurred $3.0 million in expenses related to the completion of the
strategic alternative review process and $1.2 million in expense related to an
employee benefit settlement in the fourth quarter of 2012 and reported in the
Other operating expenses, net line. The Company incurred $0.8 million of
restructuring expenses in the fourth quarter of 2011 primarily related to its
decision to close its five food commissaries.

Adjusted EBITDA was $15.4 million in the fourth quarter of 2012 compared to
$16.8 million in the fourth quarter of 2011, but was up 11.7% to $49.7 million
for fiscal 2012. (*)

Net income in the fourth quarter of 2012 was $3.2 million, or $0.18 per
diluted share, which included $0.15 per diluted share for strategic
alternatives and employee benefit audit settlement expenses. Net income in the
fourth quarter of 2011 was $6.1 million, or $0.36 per diluted share, which
included $0.03 per diluted share for restructuring expenses. The impact of the
14^th week in the fourth quarter of 2011 was approximately $0.03 in earnings
per diluted share.

For the year, net income was $12.7 million, or $0.74 per diluted share
compared to net income of $13.2 million, or $0.78 per diluted share.

On a comparable 52-week basis, adjusted net income increased $3.3 million, or
25.2%, to $16.4 million, or $0.95 adjusted earnings per diluted share,
compared to adjusted net income of $13.1 million, or $0.78 adjusted earnings
per diluted share. (*)

* A reconciliation of the non-GAAP measure to the nearest GAAP measure can be
found in the accompanying tables below.

Restaurant Development

As of January 1, 2013, there were 816 Einstein Bros.® Bagels, Noah's New York
Bagels®, and Manhattan Bagel® branded restaurants in operation. During the
fourth quarter of 2012, the Company opened 11 company-owned restaurants and
ended the quarter with 461 Company-owned and operated restaurants, while
franchisees and licensees opened 4 and 5 restaurants, respectively, and ended
the period with 97 and 258 restaurants, respectively.

Fiscal 2013 Guidelines

The Company is providing the following guidelines for the 52-week fiscal year.

  *60 to 80 system-wide openings, including 15 to 20 Company-owned
    restaurants, 15 to 20 franchise restaurants, and 30 to 40 license
    restaurants.
  *Capital expenditures of $20 million to $22 million.
  *Cost of goods inflation of approximately 2% to 3%, which the Company
    expects to be fully offset through efficiency initiatives.
  *Pre-opening expense of $65,000 to $75,000 per new company-owned unit.
  *Interest expense of $6.5 million to $7.0 million.
  *An annual effective tax rate not to exceed 39%; however, the Company
    expects to only pay minimal cash-taxes for the next several years.

Conference Call Today

The Company will host a conference call to discuss its fourth quarter and
fiscal 2012 financial results today at 3:00 p.m. Mountain Time (5:00 p.m.
Eastern Time). Hosting the call will be Jeff O’Neill, President and Chief
Executive Officer, and Manny Hilario, Chief Financial Officer.

The dial-in numbers for the conference call are 888-428-9480 for domestic
toll-free calls and 719-325-2362 for international. A telephone replay will be
available through March 7, 2013, and may be accessed by dialing 877-870-5176
for domestic toll-free calls or 858-384-5517 for international. The conference
ID is 3094520.

The conference call will also be webcast live from Einstein Noah’s website at
www.einsteinnoah.com.

About Einstein Noah Restaurant Group

Einstein Noah Restaurant Group, Inc. is a leading company in the quick casual
restaurant industry that operates franchises and licenses locations under the
Einstein Bros.®, Noah's New York Bagels® and Manhattan Bagel® brands. The
Company's retail system consists of over 820 restaurants in 40 states and the
District of Columbia. It also operates a dough production facility. The
Company's stock is traded on the NASDAQ under the symbol BAGL. Visit
www.einsteinnoah.com for additional information.

Forward Looking Statement Disclosure

Certain statements in this press release, including statements under the
heading “Fiscal 2013 Guidelines”, constitute forward-looking statements or
statements which may be deemed or construed to be forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
The words “guideline,” “forecast,” “estimate,” “project,” “plan to,” “is
designed to,” “look forward,” “expects,” “prospects,” “intend,” “indications,”
“expect,” “should,” “would,” “believe,” “target,” “trend,” “contemplate,”
“anticipates” and similar expressions and all statements which are not
historical facts are intended to identify forward-looking statements. These
forward-looking statements involve and are subject to known and unknown risks,
uncertainties and other factors which could cause the Company's actual
results, performance (financial or operating), or achievements to differ
materially from the future results, performance (financial or operating), or
achievements expressed or implied by such forward-looking statements. These
unknown risks, uncertainties and other factors include but are not limited to
(i) the results for the 2012 fourth quarter and year over year revenue and
other financial results, comparable store sales, and margin performance are
not necessarily indicative of future results, and our expectations for 2013
results are subject to shifting consumer preferences, new product execution,
economic conditions, weather, competition, seasonal factors and cost
containment initiatives, among other factors; (ii) our ability to improve
transactions and our long-term growth are dependent upon consumer acceptance
of our products and marketing initiatives, general economic and market
conditions, among other factors; (iii) our ability to continue to improve
store level margins and contain costs are dependent upon successfully
executing plans for productivity improvements, labor efficiencies and food
cost management; (iv) the ability to develop and open new company-owned,
license and franchise restaurants and upgrade company-owned restaurants is
dependent upon the availability of capital, securing acceptable financing and
lease terms for desired locations, as well as the availability of contractors
and materials, and securing necessary permits and licenses; (v) our ability to
expand our development pipeline and ultimately expand our royalty stream is
dependent upon the factors listed in (iv), above, and our ability to attract
franchisees and licensees and negotiate favorable agreements; (vi) our ability
to obtain lower costs for agricultural commodities is dependent upon weather,
crop yield and production, the market, economic conditions, including market
and inflationary pressures; (vii) our ability to build brand equity and create
long-term value for our shareholders is dependent upon the success of our
initiatives, financial results and the factors listed above, among other
factors. These and other risks are more fully discussed in the Company's SEC
filings.

Use of Non-GAAP Financial Information

In addition to the results reported in accordance with accounting principles
generally accepted in the United States of America (“GAAP”) included in this
filing, the Company has provided certain non-GAAP financial information,
including non-GAAP total revenues excluding the extra week in fiscal 2011;
adjusted earnings before interest, taxes, depreciation and amortization,
restructuring expenses, strategic alternative expenses, write-off of debt
issuance costs, and other operating expenses/income (“Adjusted EBITDA”); net
income adjusted for the extra 53rd week in fiscal 2011, restructuring
expenses, strategic alternatives expense, incremental interest expense on
additional credit facility borrowings and other operating expenses/income
(“Adjusted Net Income”); earnings per share adjusted for the extra 53rd week
in fiscal 2011, restructuring expenses, strategic alternatives expense,
incremental interest expense on additional credit facility borrowings and
other operating expenses/income (“Adjusted Net Income Per Share”); and “Free
Cash Flow”, which the Company defines as net cash provided by operating
activities less net cash used in investing activities.Management believes
that the presentation of this non-GAAP financial information provides useful
information to investors because this information may allow investors to
better evaluate our ongoing business performance and certain components of our
results. In addition, the Company’s Board of Directors uses this non-GAAP
financial information to evaluate the performance of the Company and its
management team. This information should be considered in addition to the
results presented in accordance with GAAP, and should not be considered a
substitute for the GAAP results. We have reconciled the non-GAAP financial
information to the nearest GAAP measures.

The Company includes in this report information on system-wide comparable
store sales percentages. System-wide comparable store sales percentages refer
to changes in sales of our restaurants, whether operated by the company or by
franchisees and licensees, in operation for six fiscal quarters including
those restaurants temporarily closed for an immaterial amount of time. Some of
the reasons restaurants may be temporarily closed include remodeling,
relocations, road construction, rebuilding related to site-specific
catastrophes and natural disasters. Franchise and license comparable store
sales percentages are based on sales offranchised and licensed restaurants,
as reported by franchisees and licensees. Management reviews the increase or
decrease in comparable store sales to assess business trends. Comparable store
sales exclude permanently closed locations. When the Company intends to
relocate a restaurant, it considers that restaurant to be temporarily closed
for up to twelve months after it ceases operations. If a suitable relocation
site has not been identified by the end of twelve months, the Company
considers the restaurant to be permanently closed. Until that time, the
Company includes the restaurant in its open store count, but exclude its sales
from our comparable store sales. As of January 1, 2013, there are seven stores
that the Company intends to relocate, and are thus considered to be
temporarily closed.

The Company uses company-owned store sales, franchise and license sales and
the resulting system-wide sales information internally in connection with
restaurant development decisions, planning, and budgeting analyses. The
Company believes system-wide comparable store sales information is useful in
assessing consumer acceptance of our brands; facilitates an understanding of
our financial performance and the overall direction and trends of sales and
operating income; helps us appreciate the effectiveness of our advertising and
marketing initiatives; and provides information that is relevant for
comparison within the industry.

Comparable store sales percentages are non-GAAP financial measures, which
should not be considered in isolation or as a substitute for other measures of
performance prepared in accordance with GAAP, and may not be equivalent to
comparable store sales as defined or used by other companies. The Company does
not record franchise or license restaurant sales as revenues. However, royalty
revenues are calculated based on a percentage of franchise and license
restaurant sales, as reported by the franchisees or licensees.

EINSTEIN NOAH RESTAURANT GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except earnings per share and related share information)
                                    
                                    Fiscal quarter ended         Increase/
                                      (in thousands)                (Decrease)
                                      January 3,    January 1,
                                      2012           2013           2012
                                      (14 weeks)     (13 weeks)     vs. 2011
                                                                    
Revenues:
      Company-owned restaurant        $ 103,000      $ 99,519       (3.4    %)
      sales
      Manufacturing and commissary      9,002          7,841        (12.9   %)
      revenues
      Franchise and license related    3,139         3,286        4.7     %
      revenues
Total revenues                          115,141        110,646      (3.9    %)
                                                                    
Cost of sales (exclusive of
depreciation and amortization shown
separately below):
      Company-owned restaurant
      costs
      Cost of goods sold                30,040         26,893       (10.5   %)
      Labor costs                       29,016         28,930       (0.3    %)
      Rent and related expenses         10,117         10,669       5.5     %
      Other operating costs             9,619          10,192       6.0     %
      Marketing costs                  2,023         2,413        19.3    %
      Total company-owned               80,815         79,097       (2.1    %)
      restaurant costs
                                                                    
      Manufacturing and commissary     7,988         6,021        (24.6   %)
      costs
Total cost of sales                     88,803         85,118       (4.1    %)
                                                                    
Gross margin:
      Company-owned restaurant          22,185         20,422       (7.9    %)
      Manufacturing and commissary      1,014          1,820        79.5    %
      Franchise and license            3,139         3,286        4.7     %
Total gross margin                      26,338         25,528       (3.1    %)
                                                                    
Operating expenses:
      General and administrative        9,464          9,375        (0.9    %)
      expenses
      Depreciation and amortization     5,276          4,915        (6.8    %)
      Pre-opening expenses              110            711          **
      Restructuring expenses            765            -            **
      Strategic alternatives            -              2,992        **
      expense
      Other operating expenses, net    381           1,273        234.1   %
Income from operations                  10,342         6,262        (39.5   %)
                                                                    
Interest expense, net                  852           1,062        24.6    %
Income before income taxes              9,490          5,200        (45.2   %)
      Provision for income taxes       3,370         2,033        (39.7   %)
Net income                            $ 6,120        $ 3,167        (48.3   %)
                                                                    
Net income – Basic                    $ 0.36         $ 0.19         (47.2   %)
Net income – Diluted                  $ 0.36         $ 0.18         (50.0   %)
Cash dividend declared per common     $ 0.125        $ 4.125        **
share
                                                                    
Weighted average number of common
shares outstanding:
Basic                                   16,809,502     16,992,803   1.1     %
Diluted                                 17,022,819     17,278,632   1.5     %
                                                                    
** Not meaningful

EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
PERCENTAGE RELATIONSHIP TO TOTAL REVENUES
(unaudited)

                                                    Fiscal quarter ended
                                                    (percent of total revenue)
                                                    January 3,     January 1,
                                                    2012           2013
                                                    (14 weeks)     (13 weeks)
                                                                   
Revenues:
     Company-owned restaurant sales                 89.5     %     89.9     %
     Manufacturing and commissary revenues          7.8      %     7.1      %
     Franchise and license related revenues         2.7      %     3.0      %
Total revenues                                      100.0    %     100.0    %
                                                                   
Cost of sales (exclusive of depreciation and
amortization shown separately below):
     Company-owned restaurant costs (1)
     Cost of goods sold                             29.2     %     27.0     %
     Labor costs                                    28.2     %     29.2     %
     Rent and related expenses                      9.8      %     10.7     %
     Other operating costs                          9.3      %     10.2     %
     Marketing costs                                2.0      %     2.4      %
     Total company-owned restaurant costs           78.5     %     79.5     %
                                                                   
     Manufacturing and commissary costs (2)         88.7     %     76.8     %
Total cost of sales                                 77.1     %     76.9     %
                                                                   
Gross margin:
     Company-owned restaurant (1)                   21.5     %     20.5     %
     Manufacturing and commissary (2)               11.3     %     23.2     %
     Franchise and license                          100.0    %     100.0    %
Total gross margin                                  22.9     %     23.1     %
                                                                   
Operating expenses:
     General and administrative expenses            8.2      %     8.5      %
     Depreciation and amortization                  4.6      %     4.4      %
     Pre-opening expenses                           0.1      %     0.6      %
     Restructuring expenses                         0.7      %     0.0      %
     Strategic alternatives expense                 0.0      %     2.7      %
     Other operating expenses, net                  0.3      %     1.2      %
Income from operations                              9.0      %     5.7      %
                                                                   
Interest expense, net                               0.8      %     1.0      %
Income before income taxes                          8.2      %     4.7      %
     Provision for income taxes                     2.9      %     1.8      %
Net income                                          5.3      %     2.9      %
                                                                   
                                                                   
     (1) As a percentage of company-owned
     restaurant sales
     (2) As a percentage of manufacturing and commissary revenues

EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except earnings per share and related share information)
                                                               
                                                                    
                                    Fiscal year ended               Increase/
                                    (in thousands)                  (Decrease)
                                    January 3,       January 1,
                                    2012             2013           2012
                                    (53 weeks)       (52 weeks)     vs. 2011
                                                                    
Revenues:
      Company-owned restaurant      $ 378,723        $ 384,783      1.6     %
      sales
      Manufacturing and               34,542           31,037       (10.1   %)
      commissary revenues
      Franchise and license          10,330         11,186       8.3     %
      related revenues
Total revenues                        423,595          427,006      0.8     %
                                                                    
Cost of sales (exclusive of
depreciation and amortization
shown separately below):
      Company-owned restaurant
      costs
      Cost of goods sold              112,002          106,925      (4.5    %)
      Labor costs                     110,467          111,784      1.2     %
      Rent and related expenses       40,277           41,993       4.3     %
      Other operating costs           39,092           40,320       3.1     %
      Marketing costs                9,796          11,380       16.2    %
      Total company-owned             311,634          312,402      0.2     %
      restaurant costs
                                                                    
      Manufacturing and              30,441         24,236       (20.4   %)
      commissary costs
Total cost of sales                   342,075          336,638      (1.6    %)
                                                                    
Gross margin:
      Company-owned restaurant        67,089           72,381       7.9     %
      Manufacturing and               4,101            6,801        65.8    %
      commissary
      Franchise and license          10,330         11,186       8.3     %
Total gross margin                    81,520           90,368       10.9    %
                                                                    
Operating expenses:
      General and administrative      36,774           39,569       7.6     %
      expenses
      Depreciation and                19,259           19,707       2.3     %
      amortization
      Pre-opening expenses            265              1,115        **
      Restructuring expenses          1,099            480          (56.3   %)
      Strategic alternatives          -                3,677        **
      expense
      Other operating (income)       (395       )    1,592        **
      expenses, net
Income from operations                24,518           24,228       (1.2    %)
                                                                    
Interest expense, net                3,357          3,384        0.8     %
Income before income taxes            21,161           20,844       (1.5    %)
      Provision for income taxes     7,958          8,103        1.8     %
Net income                          $ 13,203        $ 12,741       (3.5    %)
                                                                    
Net income – Basic                  $ 0.79           $ 0.75         (5.1    %)
Net income – Diluted                $ 0.78           $ 0.74         (5.1    %)
Cash dividends declared per         $ 0.375          $ 4.500        1100.0  %
common share
                                                                    
Weighted average number of common
shares outstanding:
Basic                                 16,629,098       16,935,018   1.8     %
Diluted                               16,880,321       17,217,180   2.0     %
                                                                    
                                                                    
** Not meaningful



EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except earnings per share and related share information)
(unaudited)
                                                 
                                                    Fiscal year ended
                                                    (percent of total revenue)
                                                    January 3,     January 1,
                                                    2012           2013
                                                    (53 weeks)     (52 weeks)
                                                                   
Revenues:
      Company-owned restaurant sales                89.4%          90.1%
      Manufacturing and commissary revenues         8.2%           7.3%
      Franchise and license related revenues        2.4%           2.6%
Total revenues                                      100.0%         100.0%
                                                                   
Cost of sales (exclusive of depreciation and
amortization shown separately below):
      Company-owned restaurant costs (1)
      Cost of goods sold                            29.6%          27.8%
      Labor costs                                   29.2%          29.0%
      Rent and related expenses                     10.6%          10.9%
      Other operating costs                         10.3%          10.5%
      Marketing costs                               2.6%           3.0%
      Total company-owned restaurant costs          82.3%          81.2%
                                                                   
      Manufacturing and commissary costs (2)        88.1%          78.1%
Total cost of sales                                 80.8%          78.8%
                                                                   
Gross margin:
      Company-owned restaurant                      17.7%          18.8%
      Manufacturing and commissary                  11.9%          21.9%
      Franchise and license                         100.0%         100.0%
Total gross margin                                  19.2%          21.2%
                                                                   
Operating expenses:
      General and administrative expenses           8.7%           9.3%
      Depreciation and amortization                 4.5%           4.6%
      Pre-opening expenses                          0.0%           0.3%
      Restructuring expenses                        0.3%           0.1%
      Strategic alternatives expense                0.0%           0.9%
      Other operating (income) expenses, net        (0.1%)         0.4%
Income from operations                              5.8%           5.7%
                                                                   
Interest expense, net                               0.8%           0.8%
Income before income taxes                          5.0%           4.9%
      Provision for income taxes                    1.9%           1.9%
Net income                                          3.1%           3.0%
                                                                   
                                                                   
      (1) As a percentage of Company-owned restaurant sales
      (2) As a percentage of manufacturing revenues

EINSTEIN NOAH RESTAURANT GROUP, INC.
SELECTED FINANCIAL INFORMATION
(in thousands)
                                                           
                                                               
                                                               
                                                               
Selected Consolidated Balance Sheet          January 3, 2012   January 1, 2013
Information:
Cash and cash equivalents, end of period     $   8,652         $   17,432
Property, plant and equipment, net               59,017            63,013
Total assets                                     204,732           213,613
Total debt                                       74,200            136,700
Total liabilities                                116,919           186,106
                                                               
                                                               
                                                               
                                             Fiscal year ended
Selected Consolidated Cash Flow              January 3, 2012   January 1, 2013
Information:
Net cash provided by operating               $   39,110        $   48,511
activities
Net cash used in investing activities            (23,685  )        (25,861  )
Net cash used in financing activities            (18,541  )        (13,870  )
Free cash flow (cash provided by
operating
                                                 15,425            22,650
activities less cash used in investing
activities)

Reconciliation of GAAP to Non-GAAP Measures:   Fiscal quarter ended
                                                January 3,  January 1,
                                                 2012         2013
                                                 (14 weeks)   (13 weeks)
                                                              
                                                 (in thousands)
Net income                                       $  6,120     $  3,167
        Adjustments to net income:
        Interest expense, net                       852          1,062
        Provision for income taxes                  3,370        2,033
        Depreciation and amortization               5,276        4,915
        Restructuring expenses                      765          -
        Strategic alternative expenses              -            2,992
        Other operating expense, net               381         1,273
                                                              
Adjusted EBITDA                                  $  16,764    $  15,442

EINSTEIN NOAH RESTAURANT GROUP, INC.
SELECTED FINANCIAL INFORMATION
                                                          
                                                              
Reconciliation of GAAP to Non-GAAP Measures:   Fiscal year ended
                                               January 3,     January 1,
                                               2012           2013
                                               (53 weeks)     (52 weeks)
                                                              
                                                              
Net income                                     $ 13,203       $  12,741
     Adjustments to net income:
     Interest expense, net                      3,357          3,384
     Provision for income taxes                 7,958          8,103
     Depreciation and amortization              19,259         19,707
     Restructuring expenses                     1,099          480
     Strategic alternative expenses             -              3,677
     Other operating (income) expense, net      (395   )       1,592
                                                              
Adjusted EBITDA                                $ 44,481      $  49,684

                                   Trailing 12 Months Activity
                                    Company                          
                                    Owned     Franchised   Licensed   Total
Consolidated Total                          
Beginning balance - January 3, 2012 440        94           239        773
Opened restaurants                  15         13           27         55
Closed restaurants                  (1)        (3)          (8)        (12)
Refranchising, Net                  7          (7)          -          -
Ending balance - January 1, 2013    461        97           258        816

EINSTEIN NOAH RESTAURANT GROUP, INC.

NON-GAAP FINANCIAL INFORMATION

                         Fiscal quarter ended
                          January 3,                      January 1,
                          2012                                  2013
                          (14 weeks)                      (13 weeks)
                                                          
                          (in thousands, except earnings per share and related
                          share information)
                                                          
Total revenues, as        $      115,141                  $     110,646
reported
Impact of extra week in         (7,300         )              -
fiscal 2011
Non-GAAP total revenues   $      107,841                 $     110,646
                                                          
                          $      6,120                    $     3,167
Adjustments for, net of
tax:
Extra week in fiscal             (528           )               -
2011
Restructuring expenses           493                            -
Strategic alternatives           -                              1,823
expense
Incremental interest             -                              165
expense
Other operating                 246                          776
expenses, net
                          $      6,331                   $     5,931
                                                          
Weighted average number
of common shares
outstanding:
Basic                         16,809,502                     16,992,803
Diluted                       17,022,819                     17,278,632
                                                          
Net income per share
available to common       $      0.36                     $     0.19
stockholders – Basic
Adjustments for, net of
tax:
Extra week in fiscal             (0.03          )               -
2011
Restructuring expenses           0.03                           -
Strategic alternatives           -                              0.11
expense
Incremental interest             -                              0.01
expense
Other operating                 0.02                         0.04
expenses, net
Adjusted net income per   $      0.38                    $     0.35
common share – Basic
                                                          
Net income per share
available to common       $      0.36                     $     0.18
stockholders – Diluted
Adjustments for:
Extra week in fiscal             (0.03          )               -
2011
Restructuring expenses           0.03                           -
Strategic alternatives           -                              0.11
expense
Incremental interest             -                              0.01
expense
Other operating                 0.01                         0.04
expenses, net
Adjusted net income per   $      0.37                    $     0.34
common share – Diluted

EINSTEIN NOAH RESTAURANT GROUP, INC.

NON-GAAP FINANCIAL INFORMATION
                                                    
                                                     Fiscal Year Ended
                                                      January 3,   January 1,
                                                      2012          2013
                                                      (53 weeks)    (52 weeks)
                                                                    
                                                                    
                                                                    
Total revenues, as reported                           $ 423,595     $ 427,006
Impact of extra week in fiscal 2011                   (7,300)       -
Non-GAAP total revenues                               $ 416,295     $ 427,006
                                                                    
                                                      $ 13,203      $ 12,741
Adjustments for, net of tax:
Extra week in fiscal 2011                             (528)         -
Restructuring expenses                                686           293
Strategic alternatives expense                        -             2,247
Incremental interest expense                          -             166
Other operating (income) expenses, net                (246)         973
Adjusted net income                                   $ 13,115      $ 16,420
                                                                    
                                                                    
Basic                                              16,629,098    16,935,018
Diluted                                            16,880,321    17,217,180
                                                                    
Net income per share available to common              $ 0.79        $ 0.75
stockholders – Diluted
Adjustments for, net of tax:
Extra week in fiscal 2011                             (0.03)        -
Restructuring expenses                                0.04          0.02
Strategic alternatives expense                        -             0.13
Incremental interest expense                          -             0.01
Other operating (income) expenses, net                (0.01)        0.06
Adjusted net income per common share – Basic          $ 0.79        $ 0.97
                                                                    
Net income per share available to common              $ 0.78        $ 0.74
stockholders – Diluted
Adjustments for:
Extra week in fiscal 2011                             (0.03)        -
Restructuring expenses                                0.04          0.02
Strategic alternatives expense                        -             0.13
Incremental interest expense                          -             0.01
Other operating (income) expenses, net                (0.01)        0.05
Adjusted net income per common share – Diluted        $ 0.78        $ 0.95

Contact:

Investor Relations:
Raphael Gross, 203-682-8253
rgross@icrinc.com
or
Media Relations:
Liz Brady DiTrapano, 646-277-1226
lbrady@icrinc.com
 
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